A tax imposed on goods imported from outside the country that is
not imposed on similar goods from within the country. Import tariffs
may be levied on an ad valorem basis, i.e., as a certain
percentage of the estimated market value of the imported item; or on a
"specific" basis, i.e., as a fixed dollar amount per unit
imported. Import tariffs (or "duties") may be imposed mainly for the
purpose of raising revenues because they are relatively cheap and easy
taxes for a small or poorly organized government to collect, but more
usually in developed industrial societies they represent a tiny
fraction of revenues and are imposed primarily for other reasons of
economic policy. "Protective" tariffs allow domestic producers of the
good in question an artificial competitive advantage over their
foreign competitors (largely at the expense of domestic consumers of
these products) by making it impossible for the foreign producer to
sell his goods as cheaply as he otherwise would -- thus allowing
favored domestic producers to enjoy higher prices, a bigger market
share, and bigger profits.